Posted by Tina
Dodd says he was directed by the administration to alter the language in the bill.
** Update Treasury Secretary Timothy Geithner told CNN Thursday his department asked Sen. Chris Dodd to include a loophole in the stimulus bill that allowed bailed-out insurance giant American International Group to keep its bonuses. CNN **
The stench behind the bonus outrage gets stinkier by the hour. Michelle Malkin is reporting that at the last minute Chris Dodd added an executive-compensation restriction to the stimulus bill that provides an exception for contractually obligated bonuses agreed on before Feb. 11, 2009. That little provision exempts the very AIG bonuses Dodd and others are now seeking to tax. (Chuck Schumer at 100%!)
And there’s more…Open Secrets reveals that Chris Dodd, followed closely by Barack Obama, was the number one recipient of political cash in 2008 from AIG.
** Dodd, Chris (D-CT) Senate $103,100 Obama, Barack (D-IL) Senate $101,332 McCain, John (R-AZ) Senate $59,499 Clinton, Hillary (D-NY) Senate $35,965 Baucus, Max (D-MT) Senate $24,750 Romney, Mitt (R) Pres $20,850 Biden, Joseph R Jr (D-DE) Senate $19,975 Larson, John B (D-CT) House $19,750 Sununu, John E (R-NH) Senate $18,500 Giuliani, Rudolph W (R) Pres $13,200 Kanjorski, Paul E (D-PA) House $12,000 Durbin, Dick (D-IL) Senate $11,000 Perlmutter, Edwin G (D-CO) House $10,500 Rangel, Charles B (D-NY) House $9,000 Edwards, John (D) Pres $7,850 Corker, Bob (R-TN) Senate $7,400 Smith, Chris (R-NJ) House $6,900 Neal, Richard E (D-MA) House $6,500 Rockefeller, Jay (D-WV) Senate $6,500 Reed, Jack (D-RI) Senate $6,000 Udall, Mark (D-CO) House $5,800 **
I also highly recommend the following two very informative articles from the Wall Street Journal:
Congress Is the Real Systemic Risk, by Peter J. Wallison WSJ
** After their experience with Fannie Mae and Freddie Mac, you’d think that Congress would no longer be interested in creating companies seen by the market as backed by the government. Yet that is exactly what the relevant congressional committees — the Senate Banking Committee and the House Financial Services Committee — are now considering. *** In the wake of the financial crisis, the idea rapidly gaining strength in Washington is to create a systemic risk regulator. The principal sponsor of the plan is Barney Frank, the chair of the House Financial Services Committee. A recent report by the Group of Thirty (a private sector organization of financial regulation specialists), written by a subcommittee headed by Paul Volcker, also endorsed the idea, as has the U.S. Chamber of Commerce and the Securities Industry Financial Markets Association. *** If implemented, this would give the government the authority to designate and supervise “systemically significant” companies. Presumably, systemically significant companies would be those that are so large, or involved in financial activities of such importance, that their failure would create systemic risk. *** There are several serious problems with this plan, beginning with the fact that no one can define a systemic risk or its causes. The Congressional Oversight Panel, which was established to advise Congress on the use of the TARP funds, concluded — with two Republicans dissenting — that the current crisis is an example of a systemic risk evolving into a true systemic event. After all, virtually all the world’s major financial institutions are seriously weakened, and many have either failed or been rescued. If this is not an example of a systemic risk, what is? **
** President Obama joined yesterday in the clamor of outrage at AIG for paying some $165 million in contractually obligated employee bonuses. He and the rest of the political class thus neatly deflected attention from the larger outrage, which is the five-month Beltway cover-up over who benefited most from the AIG bailout. *** Taxpayers have already put up $173 billion, or more than a thousand times the amount of those bonuses, to fund the government’s AIG “rescue.” This federal takeover, never approved by AIG shareholders, uses the firm as a conduit to bail out other institutions. After months of government stonewalling, on Sunday night AIG officially acknowledged where most of the taxpayer funds have been going. *** Since September 16, AIG has sent $120 billion in cash, collateral and other payouts to banks, municipal governments and other derivative counterparties around the world. This includes at least $20 billion to European banks. The list also includes American charity cases like Goldman Sachs, which received at least $13 billion. This comes after months of claims by Goldman that all of its AIG bets were adequately hedged and that it needed no “bailout.” Why take $13 billion then? This needless cover-up is one reason Americans are getting angrier as they wonder if Washington is lying to them about these bailouts. **
A Post Script to this story is the fact that Dodd is also under investigation regarding a stinky real estate deal in Ireland that involves a fellow who was given a pardon by Bill Clinton:
** The Senate Ethics Committee has been looking into possible conflicts of interest in Connecticut Senator Chris Dodd’s 2003 mortgages. Now questions about another Dodd real-estate adventure, this one in Ireland, should keep the Ethicists even busier. All the more because Mr. Dodd’s “cottage” purchase involves a crooked stock trader for whom the Senator once did a very big political favor. *** Mr. Dodd is already under a cloud for receiving what a former loan officer claims was preferential treatment from Countrywide Financial on two mortgage refinancings — in Connecticut and Washington — in 2003. Countrywide was an aggressive lender to shaky borrowers and relied heavily on Fannie Mae and Freddie Mac to buy those mortgages in bulk. As a senior Member of the Senate Banking Committee, Mr. Dodd was one of Fannie’s greatest promoters. Mr. Dodd promised last year to disclose mortgage documents to prove he got no special treatment, but so far all he’s done is let a few hand-picked journalists take a quick peek before he put the papers back in storage. **